Union Budget 2018: Was the budget meant to please disgruntled farmers?

Representation pic

The political threat that growing unrest because of agrarian crisis and increasing number of farmers' suicides poses the BJP-ruled governments in the Centre and various poll-bound states, has finally made the Modi cabinet take a step forward to meet the demand for ensuring reasonable profits for the farming community.

Finance Minister Arun Jaitley's announcement to hike a minimum support price (MSP) for crops to 1.5 times of the production cost (with an assurance of at least 50% profit), is being seen as a last ditched effort to woo distressed farmers ahead of the Assembly elections in agriculture-dominated states of Karnataka, Chhattisgarh, Madhya Pradesh and Rajasthan this year, and Maharashtra, Telangana, Odisha, Andhra Pradesh and Haryana that will go to polls before and after next year's Lok Sabha elections. Most poll-bound states are ruled by the BJP and its allies, who have been facing farmers' ire.

In fact, the BJP had made a poll promise in 2014, especially in Haryana, that it would implement the recommendations of the MS Swaminathan Commission on the payment of an increased MSP to farmers. The state voted BJP to majority, but the party did not live upto the assurance. Even in last year's Gujarat polls, the BJP promised to double the farmers' income, but resentment in rural areas gave the ruling party a drubbing. Somehow, the BJP managed to retain power in Gujarat which later became a flashpoint for a country-wide farmers' agitation against the government.

'Unprecedented, historic move'
Rural areas remain a major concern for BJP despite it expanding its base there in 2014 and thereafter. The Modi wave and anti-incumbency against the Congress worked wonders then, but as the years passed without any major succour coming from the Centre and state governments falling short of finances to support the increasing demands, the BJP was targeted fiercely by the opposition. But the BJP finds itself on a better pitch in urban areas where it hasn't really lost a voter base.

Maharashtra in particular saw massive protests for farm debt waiver last year, in which all opposition parties and ruling partner Shiv Sena were aligned together against the BJP. Discontent continues to simmer despite a loan waiver being announced and disbursed. In such a situation, a higher MSP may bring some relief to BJP poll managers.

Little wonder then, that CM Devendra Fadanavis said the move was unprecedented and historic. "The two-decade-old demand for increasing MSP according to production cost has been fulfilled," he said. Activist Kishor Tiwari, who heads a government-controlled mission for distressed farmers, welcomed the decision. "Farmers should be happy now. They will get more in prices," he said.

The budget also made provisions to sustain agro-related side businesses that are carried out by individuals and groups of farmers. Markets will be expanded to boost rural economy. The target set is to double the farmers' income by 2022 and create more jobs for small farmers.

Move came late
Opposition parties said the decision should have been taken earlier and wanted to know what financial provisions Jaitley has made for fulfilling the promise, starting from the Rabbi season. Jayant Patil, former finance minister of Maharashtra said the farmers would trust the government if any financial provision was made. "Mr Jaitley made a financial statement without having any account for it. What is the mechanism for implementing higher MSP and insurance for 50 crore people? They are fooling people," he said.

Rs 70,080 cr
The subsidy for the fertilizer sector this fiscal

Rs 10,000 cr
Allocated for development of fisheries and aquaculture

Rs 2,000 cr
The investment on agri-market infrastructure fund

Catch up on all the latest Mumbai news, current affairs from Mumbai, local news, crime news and breaking headlines here

Download the new mid-day Android and iOS apps to get updates on all the latest and trending stories on the go